First Bank Completes Acquisition of Two Former OceanFirst Branch Locations Strengthening its Central New Jersey Presence

Rhea-AI Summary

First Bank has successfully acquired two New Jersey branches from OceanFirst Bank, completing the transaction on December 3, 2021. This acquisition includes approximately $101 million in deposits and $11 million in performing loans. The branches, located in Flemington and Monroe, enhance First Bank's footprint in Central New Jersey and aim to boost long-term value creation through added scale and low-cost funding. Despite a $23 million reduction in deposit balances prior to closing, First Bank is optimistic about growth opportunities following the integration.

Positive

• Acquisition of $101 million in deposits and $11 million in loans strengthens First Bank's market position.
• Expansion into Central New Jersey enhances market presence along the New York City to Philadelphia corridor.
• Long-term value creation expected through added scale and relationship-based low-cost core funding.

Negative

• Reduction of $23 million in deposit balances prior to closing could impact immediate liquidity.

Acquisition includes approximately $101 million in deposits and $11 million of loans

HAMILTON, N.J. and RED BANK, N.J., Dec. 06, 2021 (GLOBE NEWSWIRE) -- First Bank (Nasdaq Global Market: FRBA) and OceanFirst Bank, N.A. (“OceanFirst Bank”), the banking subsidiary of OceanFirst Financial Corp. (“OceanFirst”) (NASDAQ: OCFC), announced the completion of their previously disclosed agreement, through which First Bank has acquired two New Jersey branch locations from OceanFirst Bank. As part of the acquisition, which was completed at the close of business on December 3, 2021, First Bank also acquired approximately $101 million of associated deposits and $11 million of select performing loans.

Located in Flemington and Monroe, the two branches enhance First Bank’s existing Central New Jersey footprint and further strengthen its presence along the New York City to Philadelphia corridor.

“We are very pleased to welcome our newest customers and employees to First Bank as we continue to grow our presence in Central New Jersey,” said Patrick L. Ryan, First Bank President and Chief Executive Officer. “With added scale and additional relationship-based low-cost core funding, we see excellent opportunities for long-term value creation through this latest transaction. I want to thank our entire First Bank team, including our newest colleagues in Flemington and Monroe, for providing a seamless transition for all of our newly acquired customers.”

The $23 million reduction in deposit balances between the original announcement date and closing date can be categorized as follows: approximately $15 million in deposit balances from accounts intentionally removed from the acquisition list, $6 million in account balances that fluctuated lower over the period, and $2 million from accounts that were closed. Accounts were intentionally removed to minimize post-closing run-off.

Conversion of the branches began Friday, December 3, 2021, and continued through the weekend, with both locations reopening on Monday, December 6, 2021 as First Bank branches.

About First Bank

First Bank is a New Jersey state-chartered bank with 18 full-service branches in Cinnaminson, Cranbury, Delanco, Denville, Ewing, Flemington (2), Hamilton, Lawrence, Monroe, Pennington, Randolph, Somerset and Williamstown, New Jersey; and Doylestown, Trevose, Warminster and West Chester, Pennsylvania. With $2.4 billion in assets as of September 30, 2021, First Bank offers a full range of deposit and loan products to individuals and businesses throughout the New York City to Philadelphia corridor. First Bank's common stock is listed on the NASDAQ Global Market under the symbol “FRBA”.

About OceanFirst

OceanFirst Financial’s subsidiary, OceanFirst Bank N.A., founded in 1902, is a $11.8 billion regional bank providing financial services throughout New Jersey and in the major metropolitan markets of Philadelphia, New York, Baltimore, Washington D.C. and Boston. OceanFirst Bank delivers commercial and residential financing, treasury management, trust and asset management, and deposit services and is one of the largest and oldest community-based financial institutions headquartered in New Jersey. To learn more about OceanFirst, go to www.oceanfirst.com. 

Forward Looking Statements

This press release contains certain forward-looking statements, either express or implied, within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include information regarding First Bank’s and OceanFirst Financial’s future financial performance, business and growth strategy, projected plans and objectives, and related transactions, integration of acquired businesses, ability to recognize anticipated operational efficiencies, and other projections based on macroeconomic and industry trends, which are inherently unreliable due to the multiple factors that impact economic trends, and any such variations may be material. Such forward-looking statements are based on various facts and derived utilizing important assumptions, current expectations, estimates and projections about First Bank and OceanFirst Financial, any of which may change over time and some of which may be beyond First Bank’s or OceanFirst Financial’s control. Statements preceded by, followed by or that otherwise include the words “believes,” “expects,” “anticipates,” “intends,” “projects,” “estimates,” “plans” and similar expressions or future or conditional verbs such as “will,” “should,” “would,” “may” and “could” are generally forward-looking in nature and not historical facts, although not all forward-looking statements include the foregoing. Further, certain factors that could affect future results and cause actual results to differ materially from those expressed in the forward-looking statements include, but are not limited to: the ability to successfully implement a growth strategy, including identifying acquisition targets and consummating suitable acquisitions; continuing to sustain internal growth rates; provide competitive products and services that appeal to customers and target markets; difficult market conditions and unfavorable economic trends in the United States generally, and particularly in the market areas in which First Bank or OceanFirst Financial operates and in which their loans are concentrated, including the effects of declines in housing market values; the impact of disease pandemics, including COVID-19, on operations and customers and employees; an increase in unemployment levels and slowdowns in economic growth; levels of nonperforming assets and the costs associated with resolving any problem loans including litigation and other costs; changes in market interest rates may increase funding costs and reduce earning asset yields thus reducing margin; the impact of changes in interest rates and the credit quality and strength of underlying collateral and the effect of such changes on the market value of investment securities portfolios; the extensive federal and state regulation, supervision and examination governing almost every aspect of First Bank's and OceanFirst Financial’s operations including changes in regulations affecting financial institutions, and expenses associated with complying with such regulations; uncertainties in tax estimates and valuations, including due to changes in state and federal tax law; the ability to comply with applicable capital and liquidity requirements, including the ability to generate liquidity internally or raise capital on favorable terms, including continued access to the debt and equity capital markets; possible changes in trade, monetary and fiscal policies, laws and regulations and other activities of governments, agencies, and similar organizations. For discussion of these and other risks that may cause actual results to differ from expectations, please refer to “Forward-Looking Statements” and “Risk Factors” in the Annual Reports on Form 10-K filed by First Bank and OceanFirst Financial Corp. and any updates to those risk factors set forth in proxy statements, subsequent Quarterly Reports on Form 10-Q or Current Reports on Form 8-K. If one or more events related to these or other risks or uncertainties materialize, or if underlying assumptions prove to be incorrect, actual results may differ materially from those anticipated. Accordingly, you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and First Bank and OceanFirst Financial do not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise. All forward-looking statements, expressed or implied, included in this communication are expressly qualified in their entirety by this cautionary statement. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking statements that First Bank or OceanFirst Financial, or persons acting on First Bank’s or OceanFirst Financial’s behalf, may issue.

FIRST BANK CONTACT:
Patrick L. Ryan, President and CEO
(609) 643-0168, patrick.ryan@firstbanknj.com

OCEANFIRST BANK CONTACT:
Michael J. Fitzpatrick, Chief Financial Officer
(732) 240-4500, ext. 7506, mfitzpatrick@oceanfirst.com

FAQ

What is the significance of the acquisition between First Bank and OceanFirst Bank?

The acquisition enhances First Bank's market presence in Central New Jersey and includes significant deposits and loans.

How much did First Bank pay for the deposits and loans acquired from OceanFirst Bank?

First Bank acquired approximately $101 million in deposits and $11 million in loans.

What challenges faced First Bank during the acquisition process?

A $23 million reduction in deposit balances occurred prior to the closing, which could affect liquidity.

When did the acquisition of OceanFirst Bank branches close?

The acquisition was completed on December 3, 2021.

What are the future prospects for First Bank following this acquisition?

First Bank anticipates long-term value creation and growth opportunities in its expanded Central New Jersey footprint.